Houston has a healthy budget balance and is using conservative projections as it eyes economic uncertainty, the city's newly appointed finance director said.
Will Jones, who became Houston's finance director on Wednesday after his appointment by Mayor Sylvester Turner was unanimously approved by the city council, said the nation's fourth largest city has built up "a very healthy" fund balance ahead of a potential economic downturn.
"With inflation and the (higher) interest rates, it's difficult to see exactly where the economy is going to go," Jones told The Bond Buyer. "That's why one of our big things is to build up that strong, healthy fund balance that we did coming out of last year and to be as conservative with our projections as we can with our budget."
His work during 18 years in city government included overseeing the development of operating budgets and he served as interim finance director since Tantri Erlinawati-Emo left in June.
Jones said he was ready "to carry the torch" and ensure Houston's financial integrity after being in the interim role and getting the feel for much broader oversight.
Turner lauded Jones' work for the city and his understanding of the administration's priorities to move Houston forward "in a way that ensures that every city department or neighborhood gets the services it deserves."
"During his tenure as interim director, he has displayed the acuity and leadership needed in the role." the mayor said in a statement. "We are in good hands with Will at the helm, and I know he will continue his tenacious work ensuring the city's financial standing."
Sales tax revenue of $820 million in fiscal 2022 exceeded projections by more than $100 million and the city's current $344.8 million general fund balance is well above a minimum policy level, according to Jones.
Houston began fiscal 2023 on July 1 with a $5.7 billion budget that includes $2.74 billion of general fund spending and pay raises of 3% to 6% for city workers to counter the great resignation's impact on the government's workforce.
"We had to do that in order to retain employees to continue to provide the service that the citizens expect," Jones said.
On the pension front, reforms under a 2017 Texas law and the city's sale of $1 billion of bonds have
"Pension reform has really saved the city, but we also had some great (investment) returns for 2021," Jones said.
